For Troy Polamalu, financial success means getting rid of yes-men

“What’s this I hear about you getting another house?” says the voice on the other end of the line. It comes across as more of a challenge than a question.

“It’s a cheap house,” Polamalu insists. “Like, really cheap.”

The Steelers safety can certainly afford it. He has no debt, made $367,000 per week last season and has plenty of money in savings. â€¨”I made millions of dollars — what’s wrong with spending a small percentage of that?” he says.

The two volley back and forth for a couple of minutes about Polamalu’s wanting to invest in a third home, but the idea quickly gets shot down. “It’s not about whether you can afford it, Troy. It’s what that money can instead do for you over the course of your lifetime.”

And that was the end of it.

“As soon as the conversation was over, it was done, settled,” says Polamalu.

Here is how it works.

THE MAN ON the phone was Dusan Miletich, one of the managing principals of Arenda Capital. He’s not Polamalu’s agent or financial adviser but actually his partner.

Arenda is what’s called a multifamily office — there are around 4,000 in the U.S. — and is made up primarily of the pooled funds of four families, Miletich’s being one. Polamalu, who has netted more than $25 million after taxes since being drafted by the Steelers as the 16th pick overall a decade ago, is the office’s most recent partner.

Family office companies such as Arenda manage the net worth of wealthy families like a business. That means everything from cutting checks for car payments and mortgages to handling personal finances. It also means investing any income generated to make more money and managing wealth from generation to generation by resolving estate-planning issues. Because Arenda includes more than one family, investment decisions are made by the group for the group — everyone having something to gain, or lose.

The roots of Arenda go back to the 1960s with Miletich’s father, Vel, who partnered with Parnelli Jones, one of the most prominent race car drivers at the time. The two founded a family office with the goal of living off their real estate investments while accumulating enough to take care of future generations.

When the housing bubble burst in 2008, the company shifted its focus from retail, office and industrial properties to apartment buildings, which could be had cheaply. That year it also added the Meyer family, one of the oldest commercial landowners in Beverly Hills and Pasadena and started real estate investment funds so outsiders could take part in its growth; Arenda now has about $500 million in assets under management.

Polamalu was introduced to the business in 2010 by his brother-in-law, Alex Holmes, whose sister, Theodora, married Troy in 2005. Holmes had recently taken a job as director of business development with Arenda and had some concerns about the Polamalus’ finances and how they were being managed. This was family, after all. “He was being managed like every other athlete, and to me, that wasn’t good enough,” Holmes says.

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This is a weblog about urban issues, technology, & culture published by Jordon Cooper since 2001. You can read about me and the site here and if you are looking for one of my columns in The StarPhoenix, you can find them here.